Shionogi Eyes US Plant to Boost Antibiotic Production Amid Tariffs Challenge

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United States President Donald Trump has stated plans to gradually increase tariffs on pharmaceuticals to as high as 250%. In response, Shionogi & Company, Limited President Isao Teshirogi announced on August 7 that the firm is considering building a new manufacturing plant in the US. 

The facility would produce Cefiderocol (brand name Fetroja), a drug for treating Gram-negative bacterial infections, which is in high demand in the US.

Teshirogi revealed the plan in an interview with The Sankei Shimbun, adding that the plant is expected to be completed by January 2029, while Trump is still in office.

Tariffs Spur Shift

Cefiderocol is currently produced exclusively at Shionogi's factory in Kanegasaki Town, Iwate Prefecture. If the plan goes ahead, the new facility would mark the company's first pharmaceutical manufacturing plant in the US. 

The firm is already evaluating the supply chain for the raw materials needed for construction, as well as securing land and personnel for the project.

"If relying entirely on overseas pharmaceutical supplies poses a national security threat, then I agree," Teshirogi said, showing an understanding of Trump's policy. "I believe it's reasonable to want to accelerate and vigorously promote [domestic manufacturing]."

Meeting US Needs

"The ultimate goal is to save patients. If President Trump says, 'I want this product to be made in the US,' then we need to consider building a factory to meet that demand," he added. "We are already developing concrete plans for construction so we can act swiftly in line with the administration's direction."

Regarding financing the project, Teshirogi said, "We will also require subsidies from the US government to support the construction of the new plant."

The drug Cefiderocol is effective against infections caused by multidrug-resistant bacteria, meaning bacteria that have developed resistance to many other antibiotics. It's currently sold in Japan, the United States, and Europe, with demand growing, especially in the US.

Drawing lessons from the COVID-19 pandemic, the Japanese pharmaceutical maker emphasizes the importance of promoting local production overseas to mitigate supply chain risks. 

"We are planning to launch Cefiderocol in the US around 2030 or 2040. If we do so, building a factory [there] is unavoidable," the company president said.

Challenges Ahead

However, specialized facilities are required to produce the antibiotics that become the raw materials for Cefiderocol. 

Manufacturing these antibiotics is complex, and there seem to be few of these facilities in the US. Therefore, securing skilled engineers could be challenging.

Furthermore, China holds a near-monopoly on the supply of active ingredients for the antibiotics, "making it even more difficult to produce them at fermentation plants in the US," Teshirogi noted. 

Shionogi's president acknowledged that transferring manufacturing technology and securing a stable supply of raw materials would be the biggest hurdles ahead.

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Author: Yohei Ushijima, Sarasa Shimizu (The Sankei Shimbun)

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